How Bundled Solutions, AI, and the Art of Pricing in B2B Drive Sales and Profitability with Dan Foster

Dan Foster is a Chief Operating/Revenue Officer, who built and transformed profitable businesses across technology and telecom start-ups as well as industry powerhouses. Companies turn to him to revive struggling businesses by redefining sales, marketing and customer service strategy, scaling infrastructure, and promoting product innovation.

In this episode, Dan shares how bundled solutions increase value and close rates. He discusses AI’s growing role in B2B sales and procurement. And stresses using data to understand customer needs and justify pricing.

Why you have to check out today’s podcast:

• Learn how bundling products and services can enhance perceived value, increase close rates, and prevent price-sensitive buyers from deconstructing your offerings.
• Gain insights into how AI is transforming the sales landscape, from optimizing product recommendations to procurement teams using AI to negotiate better prices.
• Understand why pricing should be tied to the customer’s business outcomes and how to communicate the true value of your solutions effectively.

"You take the data around a pricing example and you really understand the value from the end user's perspective, so you got to have that empathy back in to say what moves their business. And when we understand what moves their business with a few numbers, then you start to give the underpinning for why value pricing matters."

- Dan Foster 

Topics Covered:

02:01 - How his early consulting work made him think about value and led him to pricing

03:23 - Asking about typical reactions to pricing presentations

04:24 - Explaining that selling value starts with understanding product-market fit 

07:03 - Highlighting the importance of teaching distribution partners how to sell value, using the Home Depot-SolarCity partnership as an example

10:43 - How can ROI calculators be convincing

14:07 - Explaining that while they don't track proven value directly due to lack of data, anecdotal feedback and supplier insights indicate improved close rates for partners

15:09 - How AI is reshaping product offerings, expanding technology advisors' roles, and influencing cost-cutting for innovation

19:10 - Highlighting that while AI may drive procurement efficiencies complex digital transformation solutions still rely on expertise

20:27 - How bundling simplifies purchasing and reinforce the value of an all-in-one solution

24:27 - Dan's best pricing advice

Key Takeaways:

"If you want to buy a ton of storage and it's a commodity, we get that. That could go through the marketplace earlier than not. If you want a digital transformation, if you want to change your customer experience, if you want to make your business run faster, if you want business process automation and robotic process automation, that's not going through a dynamic pricing model on a marketplace near-term. Now, can I go out and look at, like, UiPath Licensing versus Automation Anywhere versus whoever Microsoft scooped up next and look at pricing models? The procurement folks are probably smart to do that." - Dan Foster

"But the bundled solution specifically is, I think, fundamental because otherwise, when you offer them the menu-based pricing, oftentimes they don't see the full value." - Dan Foster

"It [selling value] starts with that product-market fit. We do a lot of enablement of our partners or downstream almost like a two-tier distributor. And in doing that we provide the ability for them to see a higher close rate when they use tools and resources. It alleviates that conversation and it's inherent that there's value pricing there." - Dan Foster

"It's critical to think through in a subscription-based model what that value is, because that customer acquisition cost versus the long-term value of a customer, it's a critical ratio to understand when you're thinking through pricing." - Dan Foster

People/Resources Mentioned:

• Cummins Engine Company: https://www.cumminsenginepart.com/
• Unilever: https://www.unilever.com
• Alcoa: https://www.alcoa.com/global/en/home/
• Amazon: https://www.amazon.com/Selling-Value-Deals-Higher-Prices/product-reviews/1737655217/ref=cm_cr_dp_d_show_all_btm?ie=UTF8&reviewerType=all_reviews&
• SolarCity: https://en.wikipedia.org/wiki/SolarCity
• Home Depot: https://www.homedepot.com
• Azure: https://azure.microsoft.com/
• Google: https://www.google.com/?client=safari
• Lowe's: https://www.lowes.com
• Sun Power: https://us.sunpower.com
• Sunrun: https://www.sunrun.com
• TD Synnex: https://www.tdsynnex.com/na/us/
• Ingram Micro: https://www.ingrammicro.com
• Five9: https://www.five9.com
• Genesys: https://www.genesys.com/en-sg/
• NICE inContact: https://www.nice.com/
• Zoom: https://zoom.us
• Dialpad: incontact.com/content/home.htm
• ChatGPT: https://chatgpt.com
• Wall Street Journal: https://www.wsj.com/
• Automation Anywhere: https://www.automationanywhere.com
• Microsoft: https://www.microsoft.com/en-ph/
• UiPath Licensing: https://licensing.uipath.com/
• Hulu: https://www.hulu.com/welcome?orig_referrer=https%3A%2F%2Fwww.google.com%2F
• Roku TV: https://www.roku.com/products/roku-tv?srsltid=AfmBOoomwWI9G8ZABYW7gSPFzBHc87xVmartPBXAWzj7GfPfAJQYjTtO
• Super Bowl: https://en.wikipedia.org/wiki/Super_Bowl
• Xfinity: https://www.xfinity.com/

Connect with Dan Foster:

• LinkedIn: https://www.linkedin.com/in/jdanfoster/
• Email: dfoster@telarus.com

Connect with Mark Stiving:

• LinkedIn: https://www.linkedin.com/in/stiving/
• Email: mark@impactpricing.com